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How We Create the Wealth of Nations

Common innovation is the contribution of ordinary people to innovation and the wealth of nations. Innovation and wealth creation are not merely the monopoly of business. While Schumpeter described business innovation as a, ‘perennial gale of creative destruction’, common innovation is more a, ‘gentle and benign breeze’. This book analyses some illustrations of the destructive side of business innovation, and provides numerous examples of the ‘benign breeze’ of common innovation. It builds on the pioneering work of von Hippel, but takes that a step further. In common innovation, the ordinary citizen is centre stage and business can be quite peripheral

Chapter 18: Socio-Economic Environment

Monograph Chapter

Extract

Following the framework used in Part I (Chapter 6), this chapter concerns
common innovation and the socio-economic environment. Some of the ideas
to be discussed here are better known as social innovation,1 and this will be
familiar ground to many readers. But the scope of this chapter is wider than
the conventional interpretation of social innovation.
Social innovation is by no means a new idea. We can find important
social innovations and innovators from the dawn of the industrial revolution
(Mulgan, 2007). One of the earliest and most important innovators was
Robert Owen, the enlightened owner of textile mills in New Lanark,
Scotland. Owen acquired these mills at the end of the 18th Century, and
transformed them from a very harsh working environment into a model
community, with facilities, medical care and comprehensive education. His
example inspired many other social innovators.
Mulgan (2007, p. 8) offers this definition of social innovation:
‘innovative activities and services that are motivated by the goal of meeting a
social need and that are predominantly developed and diffused through
organisations whose primary purposes are social.’ This puts the emphasis on
innovations with a social purpose. In this chapter, I shall cast the net even
wider – in line with the format of all the chapters in Part III. We shall
consider all three of the following:
_ innovation that directly enhances the socio-economic environment
_ innovation that exploits other categories (e.g. science) to enhance
the socio-economic environment
_ innovation that exploits the socio-economic environment to enhance
other categories (e.g. consumption in the home)

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